VR Gaming has been Cancelled

On January 13th, 2026, Meta announced they were laying off over a thousand employees from their Reality Labs division. They're sacking entire studios. Studios that just released games. Studios that made some of the higher-end VR titles.
Twisted Pixel—the studio behind the very recent Deadpool VR—is gone. Completely shuttered. That game only just came out in November 2025.
Sanzaru Games—the team that made Asgard's Wrath 2, one of the most acclaimed VR games of all time—is gone. The entire studio closed.
Armature Studio—the people who ported Resident Evil 4 to VR—is now closed. Camouflaj? The studio behind Batman: Arkham Shadow? Again, a game that just came out. A near-total layoff with a skeleton crew remaining. All future projects are canceled. These weren't failing studios. These weren't mediocre teams making shovelware. These were some of the biggest VR developers in the world, making the biggest games on the platform.
And Meta just erased them. VR gaming as we knew it is over. And what killed it tells us something important about where the entire entertainment industry is heading.
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